Cope With It V.1
01/09/09
Cold Turkey!
“My Body Is Achin’
Fever Is High
Can’t See No Future
Can’t See No Sky”
OK, so there are a couple of things that are right with the world…for instance, both The Dead and Phish will be touring (separately) this summer. Other than that little item, sales (in particular) music sales for physical goods essentially sucked over the holidays this past year! The American consumer bought more music in 2008 than ever before, but album sales (the music industry’s main source of revenue) dropped again for the fourth straight year. According to the folks at Nielsen SoundScan, CD, vinyl, cassette and digital purchases of entire albums, plus digital track downloads, singles and music videos, reached a new high of 1.5 billion, up 10.5% over 2007. So what’s the problem one might ask? Well, more than 70% of those sales were digital track downloads, for a record total of 1.07 billion, blowing away 2007’s previous high of 844.2 million by 27%. In fact, digital track downloads outsold albums by a 2.5 to 1 ratio in 2008, with total album sales dropping to 428.4 million, 14% fewer than in 2007, and falling 45% since 2000. Rob Sisco, Nielsen’s President of Music states that music purchases are “astronomically high, but it’s a marketplace in transition from physical to digital.” New albums by big acts bring the market up, he says, but “there hasn’t been a steady stream of high-profile releases.”
Trans World has just reported that its stores sales were down 12%-14% this holiday selling season over last year’s numbers. Best Buy sold a relatively disappointing 325,000 units sold for the chain’s exclusive release of Guns “n Roses Chinese Democracy album. WalMart, however, experienced continual sales, reaching over the 1.3 million mark from their exclusive release from AC/DC’s newest album, Black Ice, coupled with a strongly supported catalog program which was aggressively sale priced over the holidays. Of course it didn’t hurt that AC/DC also did a sold-out tour of The States between October (when the album was released) & December while the Guns ‘N Roses Tour never happened. Radio, video, print, and TV ads where in everyone’s face reminding fans of Black Ice’s exclusive WalMart release and the tour. The record/tour combo was one of the best album set-ups plans in years, taking full advantage of every opportunity, while pounding WalMart into one’s head. (I bought mine at AC/DC.com a month before the release…I hate WalMart.) In the other corner (display that is), Chinese Democracy was released the week before Thanksgiving with a flurry of non-activity. It was like this “most highly anticipated album in 13 years” was almost DOA. OK, there was a decent pulse of sales for a minute, but it hasn’t sustained and this band is invisible to the public.” One more thing, AC/DC was not available at iTunes and Guns ‘N Roses was totally available for all to put in their cart.
Now don’t get me wrong, there were some good things that happened this year. Radiohead releases its new album, In Rainbows, online first, for any price that the customer wants to pay. The digital only was released in 2007, with the CD version being released in 2008. The band had a nice little run by actually selling and giving away a ton of downloads, followed by a release of the album on CD & vinyl, with a #1 debut on Billboard, StreetPulse, Hits, and any sales chart you like. In fact, In Rainbows sold over 25,000 units on vinyl in the U.S. and was the #1 album at Independent retail…followed by the eponymous debut of Vampire Weekend at #2. That’s a pretty amazing feat these days Artists like Fleet Foxes, Cat Power, TV On The Radio, Feenesz, and Sigur Ros all laid a strong base of sales and support at Independent retail, while vinyl makes a strong return…with some stores selling 15-20% of there overall sales in vinyl. The fact is that vinyl sales are up for the fifth straight year, showing that if you make it, they will come. FYI, the afore-mentioned AC/DC Black Ice disc reeled in over 800,000 sold, at one account, in one week. That should prove that CDs sell if the album and artist is approached in the right manner. It’s called set-up or following the buzz on the street!
Back to the guys in the big yard…Wal-Mart will be the exclusive U.S. retailer for Bruce Springsteen & the E Street Band’s “Greatest Hits,” which will arrive Jan. 13, two weeks prior to the group’s new Columbia studio album, “Working on a Dream.” The 12-track set omits material from Springsteen’s albums without the E Street Band to round up classics such as “Born To Run,” “Thunder Road,” “Born in the U.S.A.” and “Darkness on the Edge of Town.” Both “Greatest Hits” and “Working on a Dream” will be in stores when Springsteen and company performs at the Super Bowl XLIII halftime show on Feb. 1 in Tampa, Fla.
In Billboard’s Jun 6th issue it states, “At the MacWorld conference today (Jan. 6) in San Francisco, Apple Inc. confirmed reports that all four majors were now onboard to deliver DRM-free music through the iTunes Music Store. The company will also embrace a variable pricing model starting in April; the price points are listed as 69 cents, 99 cents and $1.29. The company said more songs would be priced at 69 cents than $1.29. iTunes began offering 8 million of its 10 million songs in a DRM-free format, today, and the remaining two million songs offered will be offered DRM-free by the end of March. Additionally, iPhone 3G users can now preview and purchase music from iTunes over the phone’s built-in 3G network.” What this means has yet to be seen. If a DRM-free track was really THE incentive for the consumer to buy content, then wouldn’t Amazon (who has offered DRM-free tracks) rule digital sales?
What it really comes down to is offering the music consumer a quality product at a reasonable price. There are too many options out there right now for people to buy, steal, or consume music in whatever way they like. The artists need to create quality music that strikes people in their hearts…something that they MUST own, not just listen to and then deposit somewhere. The labels and management are charged with making that process happen and ultimately offering the consumer something that they feel good about purchasing and supporting. Retail sales take place in a lot of different places, not just online. The freestanding store and physical product still plays a dominant role in the development and ultimate sales success of an artist. To quote one Mark Twain, “The reports of my death have been greatly exaggerated.” Please feel free to apply this quote to physical sales when needed.
“My Eyes Are Wide Open
I Can’t Get No Sleep
There’s One Thing I’m Sure Of
I’m Into The Deep Freeze
Cold Turkey Has Got Me On The Run”
John Lennon ‘69